“We look forward to the Chancellor finally giving the thumbs up to including peer-to-peer lending in ISAs in the Budget. Hard-pressed investors deserve better than the pitiful rates currently offered by cash ISAs.

“For example, rates for five-year cash ISAs are typically languishing at just over 2 per cent. Investing £15,240 in RateSetter’s five-year product yields around three times that at 6.5 per cent before tax. The difference amounts to hundreds of pounds in interest each year.

“By including their RateSetter investment in an ISA, a higher-rate taxpayer would save £396 in tax on a total of £990 in interest in the first year, almost doubling their net income. For a basic rate taxpayer the equivalent tax saving is a £198.”

Alongside the confirmation it is likely that the chancellor is to announce another consultation, this time designed whether to extend the list of ISA eligible investment products to include a broader range of “debt and equity securities offered via crowd funding platforms”.

“We welcome the government’s decision to extend the range of investments eligible for ISAs in 2015-16 and in particular its decision to hold a consultation on how to include peer-to-peer loans. Whilst this would represent a huge step forward for the industry, it must be accompanied by proper regulation and oversight. As an industry, we must ensure that when the inevitable happens and a platform does blow up, any resulting loss of investor confidence does not signal the end of a sector which is beginning to fill a critical gap in the credit ecosystem.”

AltFi Berlin Summit 2019

AltFi is coming to Berlin this Winter for our first annual Summit in the City.

AltFi provides market-leading news, opinion, insights and events for the rapidly-growing alternative finance and fintech community. Our core focus is on disruption to lending, banking and investing, including peer-to-peer lending, challenger banks, digital wealth management and institutional adoption of crypto technology. In addition, AltFi runs major industry events around the world.Find out more